FINAL

BHAVANA,POOJA,RASHI,NAVEEN & PARASURAMU : 

BHAVANA,POOJA,RASHI,NAVEEN & PARASURAMU PROJECT BY

Slide 2: 

PURPOSE DESIGN / APPROCH The approach of the BNS is studied through a case study of one of the largest fast moving consumer goods networks the “ HLL Net” To demonstrate the impact of redesigning business policy and relationship apart from process reengineering across the HLL network. It explains the successful use of enterprise systems to enhance business value across the business network

Slide 3: 

Hindustan Unilever Limited (HUL) is India's largest Fast Moving Consumer Goods company, touching the lives of two out of three Indians with over 20 distinct categories in Home & Personal Care Products and Foods & Beverages. They endow the company with a scale of combined volumes of about 4 million tonnes and sales of nearly Rs.13718 crores. INTRODUCTION HUL's brands - like Lifebuoy, Lux, Surf Excel, Rin, Wheel, Fair & Lovely, Pond's, Sunsilk, Clinic, Pepsodent, Close-up, Lakme, Brooke Bond, Kissan, Knorr-Annapurna, Kwality Wall's – are household names across the country and span many categories - soaps, detergents, personal products, tea, coffee, branded staples, ice cream and culinary products. They are manufactured over 37 factories across India. The operations involve over 2,000 suppliers and associates. HUL's distribution network, comprising about 2,500 redistribution stockists, covering 6.3 million retail outlets reaching the entire urban population, and about 250 million rural consumers.

Slide 4: 

HISTORY In the summer of 1888, visitors to the Kolkata harbour noticed crates full of Sunlight soap bars, embossed with the words "Made in England by Lever Brothers“. With it, began an era of marketing branded Fast Moving Consumer Goods (FMCG). In 1931, Unilever set up its first Indian subsidiary, Hindustan vanaspati Manufacturing Company, followed by Lever Brothers India Limited (1933) and United Traders Limited (1935). These three companies merged to form HUL in November 1956. In 1912, Brooke Bond & Co. India Limited was formed. Tata Oil Mills Company (TOMCO) merged with HUL, effective from April 1, 1993. In January 2000, in a historic step, the government decided to award 74 per cent equity in Modern Foods to HUL.

Slide 5: 

Business network systems are backpack inter-organizational information systems with the potential of data sharing, forecasting and transaction processing capabilities. Traditionally EDI has been used to enhance business networking, and now extended enterprise resource planning (ERP) systems, supply chain management systems, customer relationship management systems (CRM) and e-business portals are being used to establish BNSs A BNS is further defined as a system supporting the relationships between multiple organizational units that can be either internal or external. What is BNS?

BNSs types : 

BNSs types

HLL Before ERP : 

HLL Before ERP 1,000 suppliers and 7,000 stockiest filling up shelves in over one million retail outlets. HLL has 100 factories, 13 sales branches and 121 warehouse depots, along with 93 third-party manufacturing sites. HLL has 23 central offices, two research centers .

HLL Before ERP : 

HLL Before ERP C&F agents used to plan distribution based on demand raised by stockists. C&F agents as well as stockists were given 60-90 days credit for the goods. In 1995,HLL’s net current assets as a percentage of capital employed was 44 percent, and inventory was 20 percent of divisional turnover for detergent and 24 percent of divisional turnover for personal products.

HLL After ERP(MFG/PRO) : 

HLL After ERP(MFG/PRO) HLL previously had a stock replenishment cycle time of two weeks after ERP implementation, it came down by three and half days, which translates into substantial savings in inventory costs. After ERP current assets as a percentage of capital employed was down to 8 percent, and inventory in key divisions was down to 5-6% of turnover.

HLL after ERP : 

HLL after ERP

HLL after ERP : 

HLL after ERP The stock level in the detergent fell from six week of sales to less than three weeks of sale. Finish goods stock level at distribution fell from 3 weeks to one week. HLL stockists who used to get 60-90 days of credit from HLL are now offered a special discount if they pay in advance. As a result, stockists place orders only for stocks that can be replenished quickly. This has drastically reduced the channel inventory in the entire network.

H.L.L DISTRIBUTION NETWORK SYSTEMAFTER IMPLEMENTING BNS SYSTEM : 

H.L.L DISTRIBUTION NETWORK SYSTEMAFTER IMPLEMENTING BNS SYSTEM

Trends in net current assets : 

Trends in net current assets

NEW INNOVATION IN SCM : 

NEW INNOVATION IN SCM

Conclusion : 

Conclusion HLL, a 51.6 percent subsidiary of Unilever, is the largest fast-moving consumer goods (FMCG) company in India. FMCG is a low-technology market and product differentiation is not easy. For a company like HLL the challenge is obviously to manage the differing supply chain. It needs to have strong distribution channels to achieve a high level of penetration needs of its often vastly different businesses. The case study of HLL Net demonstrates the successful use of enterprise systems to enhance business value across the business network. HLL Net is a unique case of how far an ERP package can help in optimizing the resource across the supply chain of an organization. HLL has linked its suppliers, stockists and retailers through an extended enterprise system to form a BNS called HLL Net, which has resulted in tremendous cost savings for the company.

Slide 17: 

This research has presented evidence that if an extended enterprise system is accompanied by redesign of the business policy and relationship apart from process reengineering across the business network, it further enhances the business value of network.

Slide 18: 

In 1997, HLL implemented the MFG/PRO ERP package across its 234 sites (100 manufacturing sites, 13 sales branches and 121 warehouse depots). The objective was to integrate manufacturing, financial and distribution processes to improve working capital management and reduce channel inventory across its business network. Also, it standardizes business processes across different business units and establishes BNS. HLL’s vision is “Connect, Attract and Fulfill” on a massive scale. Transportation and telecommunications infrastructures are really not up to the mark in India. Without good communication facilities, there is no point in having ERP. So HLL had to install a VSAT system for reliable communication system. HLL has 128 VSATs installed in this network. Redesigning BNS helps to reduces the potential of the harmful bullwhip effect. HLL previously had a stock replenishment cycle time of two weeks.After ERP implementation, it came down by three and half days, which translates into substantial savings in inventory costs